Politics Add to Pressure on Central Banks

By

Margit Feher

Feb. 28, 2013 5:36 p.m. ET

BUDAPEST—Hungary's premier is set to nominate a new head for the recession-hit country's central bank in coming days. One important question for investors: How independent will this appointee really be?

Prime Minister Viktor Orban and his center-right Fidesz party in recent years have steadily tried to increase their sway over the National Bank of Hungary to stimulate the economy ahead of elections in 2014—something critics say raises...